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Case 2:08-cr-00224-PSG Document 144 Filed 04/24/2009 Page 1 of 7

1 THOMAS P. O’BRIEN
United States Attorney
2 CHRISTINE C. EWELL
Assistant United States Attorney
3 Chief, Criminal Division
MARK AVEIS (Cal. Bar No. 107881)
4 EDWARD E. ALON (Cal. Bar No. 207287)
Assistant United States Attorneys
5 1200 United States Courthouse
312 North Spring Street
6 Los Angeles, California 90012
Telephone: (213) 894-4477/3825
7 Facsimile: (213) 894-8601
Email: mark.aveis@usdoj.gov
8 edward.alon@usdoj.gov
9 Attorneys for Plaintiff
UNITED STATES OF AMERICA
10 UNITED STATES DISTRICT COURT
11 FOR THE CENTRAL DISTRICT OF CALIFORNIA
12 UNITED STATES OF AMERICA, ) No. CR 08-224-PSG
)
13 Plaintiff, ) GOVERNMENT’S REPLY TO DEFENDANT’S
) OPPOSITION TO MOTIONS:
14 v. ) 1) TO DISMISS INDICTMENT AGAINST
) DEFENDANT GOLDFINGER COIN &
15 GOLDFINGER COIN & BULLION, ) BULLION, INC., WITHOUT PREJUDICE,
INC., ) AND
16 ) 2) TO DISMISS AS MOOT DEFENDANT’S
Defendant. ) MOTION FOR RETURN OF PROPERTY
17 )
) Hearing date: May 4, 2009
18 ) Time: 10:00 a.m.
19
20 I.
21 INTRODUCTION
22 The opposition of defendant Goldfinger Coin & Bullion, Inc.
23 (“Goldfinger” or “defendant”) to the government’s motion to
24 dismiss (1) the indictment and (2) defendant’s motion for return
25 of property, seeks to convince the Court that it would be better
26 to allow an essentially defunct corporation to continue
27 litigating an equitable motion for its sole benefit to recover
28 assets than to allow that same corporation to simply file a claim
Case 2:08-cr-00224-PSG Document 144 Filed 04/24/2009 Page 2 of 7

1 in a legal proceeding in which the Court will address and


2 adjudicate the claims of all parties with a potential interest in
3 the assets. The government respectfully disagrees with
4 defendant. Based on the entirety of the record in this matter,
5 the government submits that the pending civil forfeiture action
6 is the best forum in which to address the disposition of the
7 seized property. Defendant’s arguments concerning the legality
8 of the seizures are properly and should be determined as part of
9 that action, particularly in light of the government’s motion to
10 dismiss the indictment. To continue to litigate the motion for
11 return of property in the absence of pending criminal proceedings
12 would be a waste of the Court’s time and resources, particularly
13 where determination of that motion would exclude consideration of
14 other parties with potential claims to the assets. For all of
15 the reasons set out in the government’s moving papers, the
16 indictment should be dismissed without prejudice and defendant’s
17 motion dismissed as moot.
18 II.
19 ARGUMENT
20 A. The Motion for Return Should Be Dismissed in Favor of
the Civil Forfeiture Action
21
22 Defendant has characterized the government’s position as
23 attempting to “destroy” the Court’s jurisdiction. To the
24 contrary, by filing the civil forfeiture action against the
25 seized property, the government has expanded the Court’s
26 jurisdiction over the assets. As defendant points out several
27 times in its papers, the assets in the civil forfeiture case were
28

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Case 2:08-cr-00224-PSG Document 144 Filed 04/24/2009 Page 3 of 7

1 not included in the criminal indictment.1 Defendant’s motion for


2 return of property seeks to put the seized assets back into its
3 own hands, based on the statements of the person who stands most
4 to gain to the exclusion of Goldfinger’s depositors, namely,
5 James Fayed. However, as explained in the moving papers and the
6 forfeiture complaint, there is substantial evidence that (1)
7 Goldfinger is not the true owner of those assets, and (2) the
8 assets consist, at least in part, of money obtained by false
9 pretenses or outright fraud. Defendant does not contend, nor
10 could defendant reasonably contend, that the granting of its
11 motion for return of property would resolve those issues.
12 In filing the civil forfeiture action, the government
13 brought the seized property before the Court in a proceeding
14 governed by a detailed statutory scheme that will allow the Court
15 to address and adjudicate the claims of all potential owners of
16 the seized property in one proceeding. The forfeiture action is
17 therefore far more likely to “secure complete justice” than the
18 defendant’s motion for return. United States v. Martinson, 809
19 F.2d 1364, 1367 (9th Cir. 1987). Defendant has been given notice
20 of the forfeiture action, but has yet to file a claim in that
21 action.
22 Defendant’s reliance on Martinson for the proposition that
23 the government’s filing of the forfeiture action here was an
24 attempt to destroy this Court’s jurisdiction is not correct. In
25 Martinson, the government destroyed the object of the defendant’s
26 motion for return of property while the appeal of the denial of
27
1
The reasons for that exclusion were fully explained in
28 the government’s moving papers and will not be repeated here.

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1 the motion was pending before the appellate court, and then
2 argued that the appeal was moot because the property no longer
3 existed. The court found that the government could not divest
4 the appellate court of jurisdiction by destroying the property at
5 issue. Martinson is, therefore, inapposite. Here, the
6 government has brought the seized property to the Court in a
7 formal judicial proceeding that, unlike either the criminal case
8 or the defendant’s motion, will result in adjudication of the
9 rights of all potential claimants to the property.
10 B. Defendant’s Remaining Authorities Do Not Apply
11 Defendant also argues that the authorities relied upon by
12 the government are not supportive of its argument because those
13 authorities did not arise from facts identical to the instant
14 case. For example, it attempts to distinguish $8,050.00 in U.S.
15 Currency v. United States, 307 F. Supp. 2d 922, 926-27 (N.D. Ohio
16 2004), United States v. Elias, 9211 F.2d 870, 873 (9th Cir. 1990)
17 and Haltiwanger v. United States, 494 F. Supp. 2d 927 (N.D. Ill.
18 2007) on the ground that the government initiated administrative
19 forfeiture proceedings in those cases, but could not do so here.
20 To the contrary, none of those cases turned on the type of civil
21 forfeiture proceedings commenced by the government. Rather, the
22 focus was on the indisputable proposition that equitable relief
23 under Rule 41 is not available where the movant has a legal
24 remedy available to it, whether that legal remedy is in the form
25 of administrative forfeiture proceedings (which, if contested,
26 will result in the filing of a civil judicial forfeiture action)
27 or a judicial action in the first instance.
28

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1 Defendant’s argument that the government’s authorities do


2 not apply because its motion was filed in the context of a
3 criminal case is also unavailing. Defendant argues, for example,
4 that the government’s reliance on Diaz v. United States, 517 F.3d
5 608 (2008) is misplaced because Diaz involved a motion for return
6 of property filed after the criminal case had concluded. But
7 Diaz offers defendant no support here. In addition to confirming
8 the well-established rule that civil forfeiture actions divest
9 the district court of jurisdiction to determine motions for
10 return of property arising out of the same facts, Diaz held that
11 a court, when faced with a motion for return filed after the
12 completion of forfeiture proceedings, was restricted to
13 determining “whether proper procedural safeguards were observed.”
14 Id. at 611. No such determination is appropriate here because
15 the civil forfeiture action has just been commenced.2
16 The parties are in agreement that defendant can raise its
17 claims alleging illegal search and seizure in the civil
18 forfeiture action, so defendant cannot claim that the dismissal
19 of its Rule 41 motion will deny it the opportunity to present a
20 claim or defense. Nor, as noted above, can defendant claim that
21 it serves the interests of justice to adjudicate its claim to the
22 detriment of the other potential claimants whose interests will
23 be determined in the course of the civil forfeiture action. Once
24 the indictment is dismissed (and defendant does not suggest that
25 it should not be), defendant’s motion for return of property,
26 should it be allowed to survive, would be a motion involving
27
2
In Diaz, the forfeiture of defendant’s property was
28 completed administratively after his conviction.

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1 property against which a civil forfeiture complaint has been


2 filed but as to which there are no criminal proceedings pending.
3 As defendant points out at page 10 of its brief, those are
4 precisely the circumstances under which a motion for return of
5 property must be dismissed in favor of the civil forfeiture
6 action.
7 IV.
8 CONCLUSION
9 Defendant’s attacks against the government are not well-
10 taken. The government has filed the civil forfeiture action as
11 the best means to ensure that the subject property is fairly
12 returned to its rightful owners based on a claims evaluation
13 procedure that is supervised by the Court and such other persons
14 as the Court believes would be necessary to accomplish that end.
15 It is especially unreasonable for defendant to object to the
16 government’s filing a civil forfeiture action to sort out
17 competing claims. The government’s motivation in so doing was
18 based in part on James Fayed’s own conflicting statements about
19 true ownership of the subject property. Given his station in
20 life and the material inconsistencies in the record which he
21 created, the government believes it is the best interest of all
22 concerned to grant the relief requested by the government. For
23 all of the reasons set out above and in the government’s moving
24 papers, the government respectfully requests that the court
25 dismiss the indictment without prejudice
26 ///
27 ///
28 ///

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1 and dismiss defendant’s motion for return of property as moot.


2 DATED: April 24, 2009 THOMAS P. O’BRIEN
United States Attorney
3
CHRISTINE C. EWELL
4 Assistant United States Attorney
Chief, Criminal Division
5
______/s/____________________
6 MARK AVEIS
EDWARD E. ALON
7 Assistant United States Attorneys
Attorneys for Plaintiff
8 UNITED STATES OF AMERICA
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